Knowing What to Charge for HVAC Services

Posted by Rachel Kopp on February 05, 2013

You’ve dreamed of this day for years. You’ve looked forward to it, saved your money, and it’s finally time. You’ve chosen the name for your company, decided on a location, and now you have to decide what you will charge for HVAC services. You can just choose a flat rate, but there are other options that may help you avoid unnecessary expenses.

Flat Rate for Work Performed

Some contractors choose to charge a single flat rate that encompasses all of their travel expenses. The flat hourly rate is easy to calculate, and your customers may appreciate the simplicity. There will be some jobs closer to home where you make a little more, and jobs where you travel further will ultimately produce a lower profit for you. However, this is a good choice if most of your work is close to your home or office.

Many customers will want to know why you cannot just provide them with a quote for a basic job. While you can give them a ballpark estimate, it’s important to remember that any job has the potential to have hidden problems. Remind customers that ballpark estimates are based on the work going smoothly and that the fees will rise if you run into unexpected problems.

Charge for the Visit

There are some savvy consumers out there, and they may have an HVAC contractor complete several jobs at one time. It’s all done in the same house, but you could be there for the entire day instead of just a few hours. These smart customers are going to look for a contractor with a lower hourly rate to save money. Charge a service charge for going out to the house, and then provide them with that attractive hourly rate to entice them to hire you.

Travel Charges

The cost of driving has gone up over the years, but there are ways to limit the expense for you. Charge customers travel charges based on how far away from your office they are. You can charge them by the mile or apply a surcharge for various cities in the area. The travel charges will help offset the expense of gas and the wear on your vehicle.

HVAC Parts

The hourly rate your charge is strictly for your labor. Parts are almost always a separate fee. It’s wise to keep a healthy selection of parts in your truck to eliminate trips to the store. However, you should also keep an inventory with prices so you know what to charge. Some HVAC contractors make a tidy little profit by charging a higher price for parts than they paid. Others choose to help their customers save money by only charging what they paid for the parts. If you go this route, then make sure you include the tax you paid to avoid losing money on parts.

There are several factors to take into account when deciding how much you will charge for any HVAC job. The flat hourly rate may appear to be the simplest, but some customers may be scared away by the high rate. People who need help with larger jobs would rather pay a lower hourly rate along with a service and travel fee to save money, and that can help bring business your way. Whether you charge a little extra for parts or charge them only what you paid is a personal decision, but you should keep track of the prices and charge for every time used either way.

Rachel Kopp works for Benjamin Franklin Plumbing Minneapolis, which has a team of HVAC contractors and plumbers in Blaine, MN who specialize in plumbing, heating, and air conditioning repair services.

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